The 12b-1 component of C shares are not accomplishing the intended objectives. This is a frequently heard refrain. Unintended consequences can be good. C shares have provided a unique opportunity of commonality of interest between the Registered Representative (RR) and the investor. There is no reason to recommend one C share over another except for performance. There is no reason to change one C share for another except for performance. The better the performance, the better the economic return for the investor and the better the compensation for the RR. This should have been the intended objective.

Banks charge between 1% and 1.5% for managing professional managers in a client account. The average wrap fee is 1.1%. In both cases the gross fees charged to investors are in the same range or higher than the current C shares. The after tax cost to the vast majority of investors is significantly lower with C shares. Detailed research should be done on this. In each of these groups there are some who do an excellent job for investors. In each of these groups there are some who do a disservice to investors. There is a stark inconsistency in focusing on C shares which is the smallest pool of capital and the least expensive for investors.

Commissioners, I am a RR who has been in the industry for 35 years. I have been helping families manage their money and in some cases now helping the grandchildren. In all the changes that have occurred within the securities industry during those 35 years, the C shares offered the best opportunity for commonality of interest between the advisor and the client. More definitive research needs to be done in regards to the cost/benefit analysis for what is best for the investor.

I have attached some research which has just come to my attention. I think it says eloquently mathematically what I have tried to communicate verbally. Thank you for your review and consideration.